If you’re in the market to refinance your home loan and want to know if it’s worth your time and money there are several things you’ll want to consider. There is an old wives’ tale that says you should never refinance your home unless the new mortgage rate is at least percent lower than your existing mortgage rate. Consider this so called “two percent rule” of mortgage refinancing really bad advice. If you’re looking for an answer to the question “Should I Refinance My Mortgage” and want to do it with the lowest possible mortgage rate you’ll want better advice than the two percent rule. Here are several of my best refinancing tips to help you answer the question “Should I Refinance My Mortgage” and then get the best mortgage rate without paying junk fees when you’re ready to do it.
Should You Refinance Your Home?
The most common reason for refinancing is to get a lower mortgage rate and save money by lowering your monthly payment. There are reasons for refinancing with a higher mortgage rate, if you are consolidating a first and second mortgage your new rate may be slightly higher than the existing mortgage rate on your primary home loan. This is also true if you’re are refinancing your home and taking cash back for any reason at closing. As you can see the two percent rule doesn’t make sense in either one of these examples.
If you’re considering refinancing your home loan to take advantage of a lower mortgage rate it makes more sense to base your decision on a cost/savings basis rather than the bad advice of others. You can do this for yourself using a simple mortgage calculator to determine what your monthly payment will be with your new (lower) mortgage rate. Once you know the payment, make sure you’ve factored in taxes and insurance into your calculation, you can easily determine how long it will cost you to recoup your expenses from refinancing your home and if it makes sense for you to refinance with that mortgage rate. To calculate this divide the total costs of refinancing your home by how much lower your monthly payment will be with the new loan. This will tell you the number of months it will take you to recoup your expenses from refinancing and benefit from the savings of the new home loan.
Mortgage Refinancing Expenses
How much will it cost you to refinance your mortgage if you decide to go through with it? Every mortgage loan has closing costs of some kind. If you are refinancing with a traditional 15 or 30 year mortgage loan you can expect to pay many of the same fees you paid when you purchased your home. These closing costs include discount points if applicable, origination fees, processing fees, title fees, attorney fees if applicable, any number of third party fees, and of course the junk fees your mortgage broker and lender try and slip past you. If you decide mortgage refinancing makes sense in your situation you’ll want to minimize unnecessary junk fees including the hidden markup of your mortgage rate. If you’re new to the mortgage game you might find this a difficult task as most of the documents provided to you by the mortgage broker or lender are more about marketing overpriced home loans than honestly disclosing fees and closing costs on your new loan.
Everyone’s trying to make a buck at your expense when refinancing your home loan. If you approach the process with this mindset you can avoid many unnecessary fees; however, when it comes to the hidden markup of your mortgage rate you’re going need help arranging your home loan. Find the right person to arrange your next home loan and you’ll not only walk away from the table with a wholesale mortgage rate but you’ll avoid the junk fees that nearly all of your neighbors waste their money on when refinancing and there’s where my Underground Mortgage Videos can help. These videos are free and will show you how to avoid the unnecessary hidden markup of your mortgage rate while avoiding junk fees.
You an learn more about refinancing your home without paying mortgage junk fees or hidden markup by checking out my free Underground Mortgage Videos. You’ll get strategies for exploiting little known mortgage refinancing loopholes that will save you $1200 per year or more.
Here’s a sample of what you’ll get today when you sign up for my free refinancing videos. This video is about the hidden commission based markup of your mortgage rate that cost you hundreds of dollars per month unnecessarily.